In light of recent developments in the peer-to-peer lending market, we felt it important to highlight some key differences in CrowdProperty's (www.crowdproperty.com) approach to property development finance that make us stand out from the crowd. Aligned to our ethos of full and complete disclosure beyond that required of us, we also outline below the status of our current loan book.
Beyond our proposition headlines of 8% first-charge secured returns and a 100% payback track record, we are different because we:
Always take first charge security, the same legal rights that a mortgage company has over a homeowner’s home in the case of default
Only ever lend on projects with planning permission already in place
Source property projects directly as just one unique part of the many tech-enabled ways that we match capital more efficiently, meaning a better deal for both lenders and borrowers
Attract high quality projects as we offer competitive rates and excellent service to property professionals – we do not fund weak projects at high interest rates.
Have unparalleled, hands-on expertise at the heart of the business, meaning projects are assessed with deep, specialist property experience. Only c.15% of applications make it onto the platform for funding.
Are a totally independent marketplace, only funding third party projects to ensure impartial due diligence and decision making
Have been and remain solely focused on what we do and our original business model, forever getting better and better and building even stronger and deeper expertise
Offer upmost transparency on our track record and also the project, the borrowing entity and the people involved in each project, both through information on our website and through project webinars held the night before project launches
Have a 100% track record in repaying lenders’ capital and interest, paying back over £10,000,000 to date
Are directly authorised and regulated by the FCA
Are the only property development platform member of the Peer-to-Peer Finance Association (P2PFA), the ‘top table’ of UK peer-to-peer lending, alongside Funding Circle, Zopa, Market Invoice and 5 other sector leaders.
Our relentless focus on achieving a better deal for both lenders and borrowers has resulted in very strong growth this year, a rate of growth which will continue given our known pipeline of quality projects. This growth is enabled entirely by finding more quality projects, as importantly our expertise-based appraisal criteria in our rigorous due diligence processes remain the same.
For absolute transparency, which we fundamentally believe in, we also felt we should update on our current loan book. We have a 100% track record on repaying capital and interest, which historically includes full capital and interest recovery from the 3 loans which have extended by greater than 180 days (from our 2015 and 2016 loan cohorts). Loans that pass 180 days late are required to be declared in a platform’s published statistics.
We believe in sharing more than is required of us. We show aggregated statistics in standardised form but also list every one of our projects ever funded on our website. In our current loan book, as at 30th Octoner 2018, just one project is in any way late – by 30 days to be exact. This development project has been completed and over 60% of the capital and interest owed has already been returned to lenders. In addition to those already sold, 4 of the flats have sales agreed, are in solicitor’s hands and once these are complete, the rest of the capital and interest will be repaid. It is expected that the remaining will be repaid by the end of November and we require weekly updates from the borrower.
In any situation, if a loan is expected to go beyond its contracted end date, we communicate fully with the lenders involved and they receive a higher rate of interest for any late period. We continuously track all funded projects, releasing development funds to the borrower on third-party reports confirming that the appropriate value has been added. The nature of property development projects means that there are sometimes time variances. Our strict processes, however, mean that we proactively understand them, we ensure appropriate security is always in place and we tackle any issues together with the borrower, always in the best interest of the lenders. We update lenders with any issues that arise, making clear any implications on loan timescales.
Our best practice throughout the operations of our business has been recognised by members of the Peer-to-Peer Finance Association (P2PFA), who elected us into membership of the association as the 9th member and the only property development platform. This is recognition from market leaders such as Funding Circle, Zopa, Market Invoice that we have built a robust business and operate with the very best practices of the sector.
Do make sure you fully understand the historical performance of any peer-to-peer platform you are looking at - CrowdProperty's record is best-in-class.